Frequently Asked Questions
What is money laundering?
Money laundering is the process of making dirty money appear clean. Criminals clearly wish to secure the profit of their nefarious activities. Through money laundering, criminals process the criminal proceeds in order to disguise their illegal source.
How is money laundered?
In the initial - or placement - stage of money laundering, the launderer introduces his illegal profits into the financial system. After the funds have entered the financial system, the second - or layering - stage takes place. In this phase, the launderer engages in a series of conversions or movements of the funds to distance them from their source. Having successfully processed his criminal profits through the first two phases, the launderer then moves them to the third stage - integration - in which the funds re-enter the legitimate economy. For more information, please contact the FIU.
What is terrorist financing?
Terrorist financing is the process of financing terrorist acts. One of the main differences between this and money laundering is that the source of the money used in terrorist financing may be perfectly legitimate. The source of money in money laundering is always an illegal source.
What is the FATF & the 40+9 Recommendations?
The Financial Action Task Force (FATF) is an inter-governmental body whose purpose is the development and promotion of policies, both at national and international levels, to combat money laundering and terrorist financing. The Task Force is therefore a "policy-making body" which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas.
Since its creation the FATF has spearheaded the effort to adopt and implement measures designed to counter the use of the financial system by criminals. It established a series of Recommendations, known as the 40+9 Recommendations in 1990, revised in 1996 and in 2003 to ensure that they remain up to date and relevant to the evolving threat of money laundering that set out the basic framework for anti-money laundering efforts and are intended to be of universal application. The FATF has 36 members. Barbados is not a member of the FATF. Barbados is a member of the Caribbean Financial Action Task Force, an FATF- Style Regional Body that is an associate member of the FATF. For more information, direct your search to www.fatf-gafi.org.
What is the CFATF?
The Caribbean Financial Action Task Force (CFATF) is an organisation of twenty-nine states of the Caribbean Basin, which have agreed to implement common countermeasures to address the problem of criminal money laundering. Barbados is a member of the CFATF. For more information, direct your search to www.cfatf-gafic.org.
What is an FIU?
A Financial Intelligence Unit (FIU) is a central, national agency responsible for receiving (and, as permitted, requesting), analyzing and disseminating to the competent authorities, disclosures of financial information: (i) concerning suspected proceeds of crime and potential financing of terrorism, or (ii) required by national legislation or regulation, in order to counter money laundering and terrorism financing. (Source: The Egmont Group of Financial Intelligence Units)
What are the different models of FIUs?
What model is the Barbados Financial Intelligence Unit?
We are an administrative Financial Intelligence Unit.
What is the Egmont Group of FIUs?
Recognising the benefits inherent in the development of a FIU network, in 1995, a group of FIUs met at the Egmont Arenberg Palace in Brussels and decided to establish an informal group for the stimulation of international co-operation. Now known as the Egmont Group of Financial Intelligence Units, these FIUs meet regularly to find ways to cooperate, especially in the areas of information exchange, training and the sharing of expertise. There are currently 116 member FIUs. Barbados is a member of the Egmont Group. For more information, direct your search to www.egmontgroup.org.
Who are the financial institutions that must report in accordance with the Money Laundering and Financing of Terrorism (Prevention and Control) Act (MLFTA), Cap. 129?
Financial Institutions are those entities identified in Section 2 of the MLFTA that are required to adhere to a number of obligations including record-keeping of financial transactions, implementing a compliance program and reporting to the FIU of Barbados.
What is reported?
"..Any business transaction where the identity of the person involved, the transaction or any other circumstance concerning that business transaction gives any officer or employee of the financial institution reasonable grounds to suspect that the transaction
Who must report?
Any person who carries on business under the Financial Institutions Act; and(b) includes
Can an individual forward information to the FIU?
The FIU receives information either from individuals who have disclosed their identity to the FIU or from anonymous individuals with respect to money laundering and terrorist financing. There is however no obligation for the FIU to provide feedback in such circumstances.
Is there a Reporting Form?
Yes. It is known as the Suspicious/Unusual Transaction Report (STR) Form. Please proceed to the "Filing a Report" section of this website.
How do I file a Report?
Reports can be forwarded to the FIU's mailing address. Alternatively, one may forward the report by facsimile in urgent cases.
Can the financial institution disclose that an STR was filed with the FIU?
There are legislative provisions under the MLFTA prohibiting financial institutions from informing anyone including the client of the filing of the STR. Penalties or imprisonment accrue for failure to adhere with these legislative provisions.
What methods does the FIU employ to protect the information filed in the STR?
The FIU's processes to protect the information in the STR are inter alia:-
What are some of the common abbreviations found in the Anti-Money Laundering/Counter-Financing of Terrorism (AML/CFT) field?
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